Firm Insights

Please note, this post was originally posted on March 18, 2020. Due to quickly developing changes, this information may not reflect up-to-date announcements.

Please visit the following link for updated information: COVID-19 Consequence: Tax Filing and Payment Deadlines Extended

UPDATE:  Tax Filing Deadline Now Extended as Well

This past Tuesday, the Government announced that the deadline for making tax payments due on April 15^th  would be extended to July 15^th.  At that time, however, the Government cautioned that the tax return filing deadline would remain April 15^th.  Today the Government reversed that latter position and now says that the filing deadline will also be extended to July 15th.  Treasury Secretary Steven Mnuchin made the announcement via tweet (@stevemnuchin1).

At @realDonaldTrump’s direction, we are moving Tax Day from April 15 to July 15. All taxpayers and businesses will have this additional time to file and make payments without interest or penalties.

— Steven Mnuchin (@stevenmnuchin1) March 20, 2020

Federal Tax Relief

In a press conference on March 17, 2020, the U.S.  Department of the Treasury announced an automatic 90-day extension of time to make federal income tax payments. Individuals may defer up to $1 million in tax payments, while corporations may defer up to $10 million in tax payments, without incurring interest or penalties.

Passthrough entities, such as companies taxed as partnerships and S corporations, do not normally pay tax at the entity level, but the automatic tax payment extension may be utilized by owners of such entities.

The deadline for filing tax returns normally due on April 15, 2020, remains unchanged.  However, taxpayers may request an automatic six-month extension of time to file their tax returns by filing Form 4868 or Form 7004 (as applicable).

So, individuals and corporations (with a calendar-year-end) must continue to file Forms 1040 or Forms 1120 by April 15 (or timely request an automatic extension) but will not have to pay associated federal income tax until July 15, 2020.

Missouri State Tax Relief

On March 18, 2020, the Missouri Department of Revenue announced that it would follow the Treasury Department’s lead and also allow a 90-day automatic extension of time to pay tax while keeping the April 15, 2020, filing deadline.

Stay Tuned

Many details remain unclear and additional guidance regarding employment-related tax payments and filings may be forthcoming. Capes Sokol will continue to monitor developments in this area and provide updates.